sofe sofa-cfe practice test

Certified Financial Examiner Exam

Last exam update: Nov 18 ,2025
Page 1 out of 28. Viewing questions 1-15 out of 416

Question 1

Probable future economic benefits obtained or controlled by a particular entity as a result of past
transactions or events is called:

  • A. Asset
  • B. Determined asset
  • C. Operating Performance
  • D. Investment property
Mark Question:
Answer:

A

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Question 2

What are recognized and accepted by state insurance departments in evaluating the solvency of an
insurer for statutory accounting purposes?

  • A. Assets
  • B. Determined assets
  • C. Admitted assets
  • D. Altered assets
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Answer:

C

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Question 3

What do not contribute to an insurer’s solvency as measured by statutory accounting requirements?

  • A. Non-determined assets
  • B. Non-admitted assets
  • C. Unacknowledged assets
  • D. Disallow assets
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Answer:

B

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Question 4

_____________ is defined as an existing condition, situation, or set of circumstances involving
uncertainty as to possible loss to an enterprise that will ultimately be resolved when one or more
future event(s) occur or fail to occur.

  • A. Compensation
  • B. Impairment
  • C. Reimbursement
  • D. Contingency
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Answer:

B

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Question 5

Any securities representing a creditor relationship, whereby there is a fixed schedule for one or more
future payments are called:

  • A. Admitted assets
  • B. Policy imbursement
  • C. Yield amount
  • D. Bonds
Mark Question:
Answer:

D

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Question 6

The amount the owner expects to receive when the bond matures is known as:

  • A. Maturity value
  • B. Ripe value
  • C. Par value
  • D. Developed value
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Answer:

C

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Question 7

If the price is higher than par, the excess is the ____________; if the price is lower than par, the
deficiency is the ____________.

  • A. bond surplus and bond deficit
  • B. bond schedule and bond reported
  • C. bond premium and bond discount
  • D. bond capitalization and bond depreciated
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Answer:

C

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Question 8

The amount of the impairment is the difference between the net fair value (appraised) value less
estimated costs to sell) of the collateral and the insurer’s recorded investment in:

  • A. mortgage
  • B. fair value
  • C. real state
  • D. valuation of securities
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Answer:

A

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Question 9

Any real estate which is owned by and more than 50 percent occupied (based on rentable square
footage) by an insurer and its’ affiliates is considered property occupied by the company.

  • A. True
  • B. False
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Answer:

A

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Question 10

A market quote or an appraisal is used to determine what of property held for sale?

  • A. cash equivalents
  • B. annual fair value
  • C. property value
  • D. current fair value
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Answer:

D

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Question 11

All investments with remaining maturities (or repurchase dates under repurchase agreements) of
one year or less at the time of acquisition are called:

  • A. Insured investments
  • B. Long-term investments
  • C. Short-term investments
  • D. Cash investments
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Answer:

C

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Question 12

What represents balances due from brokers when a security has been sold, but the proceeds have
not been received?

  • A. Payable for securities
  • B. Receivable for securities
  • C. Security balancing
  • D. Premium security
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Answer:

B

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Question 13

Balances due within thirty days of the settlement date are included as a receivable for securities.

  • A. True
  • B. False
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Answer:

B

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Question 14

When the insurer or the intermediary may prepare a monthly recapitulation of premium and
commission transactions between the parties, commonly called:

  • A. account current
  • B. account reimbursement
  • C. balance share
  • D. premium debts
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Answer:

A

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Question 15

What include balances due from the insurer’s brokers (collectively referred to as agents’ balances)
for premium on policies written?

  • A. collected premiums
  • B. account premiums
  • C. Direct balance
  • D. Agents’ balances
Mark Question:
Answer:

D

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